The Cost Of Holding Out For A Higher Salary

Written by David Marceau, VP of Sales for Ridgefield One, LLC

Have you turned down a job offer recently because you’re holding out for a higher salary?  Have you thought about what it’s costing you to go without an income instead of taking home the lower salary?  A recent Ridgefield One assessment (see chart) produced answers to those questions along with some interesting additional results.

Depending on the salary you’re shooting for, it likely makes more sense to take the lower-paying job.  The reason is because each week without a salary is like subtracting money from your salary.  For example, if you turn down a job for $50,000 because you’d rather earn $55,000, each week you’re losing out on just under $1000 you would have earned, had you been working.  After one and a half months, if you still haven’t landed a job, you’d have given up over $5000 in income.  In other words, you’d be worse off than if you had accepted the lower-paying job. 
 

The more you’re trying to earn, the faster you’ll rack up losses by not working.  For example, if you pass up a $90,000 a year job because you’re looking for $95,000, that same $5,000 difference will be lost in only three weeks.  Waiting one and a half months will result in over $10,000 in losses.  As you get closer to the $200,000 mark, it will only take a couple weeks to create the same losses.

What’s really interesting, though, is the results of holding out on the low-end of the pay scale.  Folks who turn down a $25,000 a year job in favor of $30,000 can stay out of work for eleven weeks before realizing the results this $5,000 difference.  When you add in the fact that many people in this range will have a higher proportion of their income covered by Unemployment payments, it may actually make sense to try for the higher-paying job.  However, these same people may be more dependent on every penny that comes in and would therefore need to get back to work as quickly as possible. 

In either case, there are additional reasons for the job-seeker to get back to work now by accepting a position below salary expectations.  Our experience has shown that the longer someone stays unemployed, the harder it is to get re-employed.  Employers don’t like seeing big gaps in employment.  It makes hiring managers think the candidate really doesn’t like working, or that there’s a reason everyone is avoiding them.

Plus, every day spent out of work is a day that skills are dulled.  The world is still moving ahead while the unemployed remain stagnant.  Getting back to work and keeping skills sharp is more important in the long run than earning a few extra dollars per week today.

Often times, the people who are holding out for more money are people whose jobs went away and are never coming back (at least not at the same salary).  Middle managers, Business Analysts, Project Managers, and others who have moved on from doing to managing are in this position.

Ridgefield One is an IT and Creative Web Service Agency located in Ridgefield, Connecticut. Ridgefield One also provides an Extra Set of Hands on a Temporary Basis.

Dear Warren Buffett - Plan B

Written by Susan Sturtevant - Bookkeeper for Ridgefield One, LLC

I am hoping that in some divine intervention this letter somehow reaches you in the new-fangled age of the World Wide Web.

I have read several articles regarding your recent editorial opinion in the New York Times, “Stop Coddling the Super-Rich” and I have to say – Good Job!!!  I personally think that it is honorable that you are asking the government to stop protecting you and your friends by taking away the long standing and generous tax breaks that have been granted to the mega-rich along with the main point that it won’t hurt job growth since it would be a great investment for the future of all Americans.  But hey, let’s face the facts… if the government is going to shy away from your well thought out plan to get us out of this mess then the hard working (albeit disappearing) middleclass could use a direct boost.   So I have spent many sleepless nights trying to figure out what to suggest as a “Plan B” or workaround getting your mega-rich friends and your money into the economy without going through our government.  And strictly in my opinion – our government is currently in need of a serious shop-a-holic intervention.

So here it is – invest in small businesses.  Don’t laugh – I’m serious!

In your editorial, you mentioned that you only paid 17.4 percent of your taxable income, paying a total of $ 6,938,744.  Your average office employee paid 36 percent.  Which by my calculations (and please forgive me if it is off) you have $ 39,877,839 of taxable income and if you paid what your average employee paid in taxes the total tax bill would be $ 14,356,022.  So you received a tax break of $ 7,417,278.  WOW, that was exhausting.  So let’s work around the government who seems to want to forgo collecting any more then what they deem to be appropriate from you and your friends, all while taking from my fellow Americans’ and my pockets.

Let me get back to small businesses.  According to the SBA the following is true about small businesses:

·         Represent 99.7 percent of all employer firms.

·         Employ just over half of all private sector employees.

·         Pay 44 percent of total U.S. private payroll.

·         Have generated 64 percent of net new jobs over the past 15 years.

·         Create more than half of the nonfarm private gross domestic product (GDP).

·         Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).

·         Are 52 percent home-based and 2 percent franchises.

·         Made up 97.3 percent of all identified exporters and produced 30.2 percent of the known export value in FY 2007.

·         Produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large firm patents to be among the one percent most cited

Those are the facts that are given to us – yet, the grants are scarcely available (unless you jump through rings of fire - blindfolded) and most loan processes are just as difficult, have high interest rates, and keep growth to a minimum.  I’ve looked into Angel Investors and Venture Capitalist, however; as I am sure that you are aware, they want to make money also and want a bigger piece of the pie then most start-ups can afford.  Don’t get me wrong they have their reasons and agendas.  Everyone has an agenda (good or bad).  So why are we not investing in the little guy?  Why are small businesses not handed a helping hand from the more experienced and well-funded?  Where is the love for such a large part of our economy?  Where is the government when we need them the most? 

That’s where I am: Working for a small start-up a little over a year in a field that has many bigger contenders.  I’ve searched high and low for solutions to ease cash flow tensions, listening to public radio on my hour and a half ride to work, hoping to find a solution that will give us the leg up in the market.  And the best part is that I am working for a staffing firm – a company that helps the unemployed get back to work.  We want to expand, explore different markets, and make a stance to not only staff people at different companies but to also increase our staff.  You would think that there would be help out there to help others – but if there is I haven’t found very many options that have panned out.  This is why I am writing to you.

If you and your mega-rich friends can’t get our government to filter your tax break money back into the system – take it upon yourselves to do that.  You don’t need the government to hold your hand to get the working population back to work – just help small businesses do that for you.  Think about it.  If you have 10 friends that received the same tax break, you pool all that money into a fund to fund new businesses.   That equals $ 74,172,780 that can go directly into the economy through small businesses.  This money can help fund small business growth leading to job creations strengthening the economy.  I am not saying all the money should go into one business investment (I’m sure you would agree that would not be a wise decision), but rather spread it around.  Just imagine what 741 small businesses can do with a grant for $100,000 a piece that doesn’t need to be paid back?  Imagine what drive that could give the economy?  And hey, don’t forget we have to pay tax on that money, so in a roundabout way, a portion of your money still goes back to the government in the form of taxes.  I know it might not be as elementary as I am making it sound – but does it have to be so difficult and complex?  There is a pool of money, businesses apply, businesses receive money, employees are hired, people have more money to spend, the consumer market gets a boost, more taxes are paid, and the government gets money.  It’s like dominoes.

‘But someone needs to control the fund?’ you might say.  Well, there you go – you just created another team of newly employed individuals.  How wonderful is that.  A team of people dedicated to honestly helping those in need to take on the daunting task of sifting through thousands of potential recipients. 

I have the greatest faith that you have the resources to put this together quickly and efficiently.  Again, it shouldn’t be a difficult application to help progression.  This is an overall investment in our future without all that red tape.

So, hopefully you have received my ideas and thoughts, you are able to look at this from a positive perspective and you have gotten to the end of the letter and have said “that is a great idea, let me get started with that”.  Here I am, Middle America, small business waiting for someone to take a direct stand.

Sincerely,

Susan Sturtevant

The attitudes and opinions expresses are those of one employee and not those necessarily of Ridgefield One as a whole nor its management.

Numbers Don’t Mean a Thing, If You Ain’t Got that Zing….....

I look at numbers all day long, analyzing, configuring, reporting - the list goes on and on…. so no more boring you with the details… but what I can’t understand is these job reporting articles?
Ok, high unemployment is a reality, we get that.  (Realistically it is probably more in the double digits and not the 9.1 or 9.2% B.S. that we are fed).  Anyone who is not living under a rock understands that people are out of jobs or accepting jobs that underpay them given their qualifications and some, not all, are abusing the system just waiting for that pot at the end of the rainbow to shower down upon them.  (Between you and me, those are the people that irk me the most, but I digress). 

I get it; I was unemployed for over a year, almost two (I am one of the lucky few that was able to find a job that fits).  The most stressful times were when the State of Connecticut constantly sent me official-looking reminders that my unemployment checks would cease to exist the following week.  One time I didn’t find out that I needed to renew until the day before.  I was actually at the unemployment office for a mandatory resume writing class (don’t get me started as to how much of a joke that was) – and I went to the main desk to ask about my status since I couldn’t find the information on their website and the wait time on the phone is atrocious (you want to talk about a department that is understaffed and underpaid look no further).  Long story short, I was crying all the way home with bills to pay and no Angel Investor looking my way – I was planning a diet of Raman Noodles and time spent reading books for the next few years of my life.... thinking that this couldn’t be MY life… I have two undergraduate degrees, a master’s degree and years of professional experience – apparently in all the wrong fields.  Let’s just say depression and dark clouds loomed over my once-promised bright future.

So, in the words of one of my favorite dads: do you know “what really grinds my gears” (small shout out to Seth MacFarlane) - - - these idiotic reports regarding unemployment rates and even more so the reports about how many more jobs are added to the market http://bit.ly/o7gGOE. Oh the numbers came out on Friday?  Great.  Unemployment hasn’t changed? Expected.  More jobs are added to the market.  Wonderful. 

But who gets these jobs?  Where are they located? Are the median wages at minimum wage?  How many jobs were taken off the market?  How many more people are unemployed but stopped reporting? How many more families are seeking shelter at a local shelter because they have just used up their benefits and lost their homes?  Here is another question, what is the difference between the jobs added to the market and those that were dissolved?   Why don’t we see these numbers?  Because they might scare us back into the Stone Age?  You don’t think that we can “handle the truth”?

Oh the questions go on and on…. so if you learned anything regarding this rant of mine… know that we should not be taking the numbers that are force fed to us on the silver spoon of journalism and that they don’t mean ANYTHING unless you look at the other side of the street.  Numbers can’t lie; you just need to be looking at the whole picture.

      - Susan Sturtevant

Susan Sturtevant is a bookkeeper at Ridgefield One

Ridgefield One provides an Extra Set of Hands on a Temporary Basis for companies located in Fairfield County, Connecticut and Westchester, New York. Ridgefield One also offers IT Consulting and Creative Web Services.